The EU has found irregularities regarding a series of contracts signed by the Hungarian state for IT systems responsible for the tendering and distribution of EU funds for the 2007-13 budgetary window, local media reported on April 19, citing a draft report sent from the EU to the Hungarian Prime Minister's Office.

The problems are extensive enough to warrant a full recovery of the subsidy, and Hungary risks losing HUF18bn (€38.29mn) in EU development funding involved in the deals, should Brussels demand full repayment, according to 24.hu. Hungary must now answer the complaint, or reassign the funds, the news portal suggests.

If the report is accurate, the fuss will do little to help Hungary accelerate absorption of funds under the EU's 2014-20 budget. A slump public projects powered by Brussels was the main factor behind a deep contraction in investment in 2016, which helped drag on GDP growth. In late March, Economy Minister Mihaly Varga claimed Hungary had recently improved absorption of EU funds.

Budapest signed operating contracts for a "unified monitoring information system" (EMIR) with Welt 2000, a software developer that oversaw EU tendering and fund distribution for the 2007-13 funding period. The commission says it objects to Hungary selecting Welt 2000 as the uncontested winner in four tenders, arguing that other companies could have offered some of the services at a better price.

EMIR reportedly processed HUF10tn from the EU's Cohesion and Structural Fund programmes to Hungary in the last EU funding period. The government replaced EMIR with a new system for the current funding period, which runs from 2014-20.

The government eventually purchased Welt 2000, following years of efforts from leading politicians from both sides of the house. The deal has been the subject of widespread speculation of foul play, as Welt 2000's previously healthy owner died suddenly at the age of 47, just one day after the purchase.